Not quite that simple, unfortunately. You can only claim it back on large expenditures if you're on the fixed-rate scheme (I think that's what it's called). Computer equipment is the prime one, but it has to be over £2K in a single spend.
AFAICT most VAT on everyday expenses doesn't come back to you.
OTOH you can charge the company for your lunch every day, which means you get that paid for before corporation tax, income tax or anything else...
> OTOH you can charge the company for your lunch every day, which means you get that paid for before corporation tax, income tax or anything else...
Hmmm. I think my last accountant told me things like lunch every day were not billable to the company. But they weren't very good accountants. :)
I didn't realise it was only spends over 2K that could be claimed back. Do you have a reference for that?
Overall, VAT registration didn't seem to offer me much (given that my clients are all outside the UK) but I'm curious to know if there are circumstances where it might make sense.
It was guidance from my accountant and other contractors have said the same. Receipted lunch and travel expenses are reclaimable when I am on a client site. Which I am most days, as I prefer to work closely with the client's team, though reserve the right to work from wherever I want. Most notably, last year, I did a few days work from a rented office in Australia where I was on holiday at the time! I claimed the office rental too...
Best I can find on VAT in a ten-second search is this -
This £2K thing probably does only apply to companies on flat-rate schemes.
The idea is that for a small business, the overheads of processing all the VAT refund stuff are just too large, so you give relief on large purchases only, and the income boost I mentioned in the other post is probably supposed to make up for it. Or something. I don't claim to fully understand!
